Shares of iRobot (NASDAQ:IRBT) were down 21.8% as of 3 p.m. EDT Wednesday, after the home-robotics company announced mixed first-quarter 2019 results -- at least relative to Wall Street's expectations.
On one hand, iRobot's quarterly revenue grew 9.5% year over year to $237.7 million, below the $251.4 million most analysts were modeling. Earnings, on the other hand, grew 9.9% to $0.78 per share on a GAAP basis -- well above consensus estimates for $0.59 per share -- and arrived at $0.96 per share excluding one-time items.
iRobot management elaborated that revenue growth in the first quarter was in line with their own expectations, helped by stronger-than-expected demand for the high-end i7 and i7+ Roomba models in the U.S., despite recent price increases to help offset the impact of tariffs. iRobot also touted a "very successful" launch for the i7 and i7+ in the EMEA (Europe, Middle East, and Africa) region, Japan, and China during the quarter. And it teased that several new products will be introduced later this year, including its new Terra robotic lawn mower.
This shouldn't be entirely surprising. During iRobot's last earnings conference call in February, CFO Alison Dean stated that "year-over-year revenue growth rates [would] be highest in Q2 and Q4, due in part to the anticipated timing of new product introductions and distribution rollout."
Sure enough, this time iRobot chairman and CEO Colin Angle added: "Strong global demand for these products, coupled with the launch of two new products in the second quarter, are expected to drive Q2 revenue growth in the high teens year-over-year."
iRobot reiterated its guidance for full-year 2019 revenue of $1.28 billion to $1.31 billion, for growth of 17% to 20% from 2018. And -- mostly to reflect a one-time favorable tax item recognized in Q1 -- it increased both ends of its previous outlook for 2019 earnings per share by $0.15, to a range of $3.15 to $3.40.
Put simply, iRobot started 2019 just as it said it would. But the market obviously isn't happy with its lumpy growth in the near term. If iRobot indeed accelerates that growth later this year to meet its full-year targets, I suspect this drop will prove an attractive chance to pick up iRobot stock at a discount.